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Champion Funds Still Beating the Market

Picking winning funds requires more than just eating our Wheaties.

Let's cut right to the chase, shall we? The next issue of the Fool's Champion Funds newsletter is going to be worth the price of an annual subscription on its own -- and you can take the plunge for free right now.

Curious? We thought so. Here's the inside scoop.

Greatest hitsLike those old K-tel records that you used to love as a kid -- C'mon, admit it: You know you own Mellow Gold -- the March edition of Champion Funds is something like a greatest-hits collection. The upcoming issue reviews each of the picks I've made over the last year, revisiting the investment thesis (as the pros like to say) and finding that -- surprise, surprise -- in every case, that thesis still holds water.

That's no coincidence, of course. Every single one of our recommendations has made money for shareholders since I gave it the nod. And taken as a whole, our picks have handily beaten the market since we first opened for business back in March 2004.

To be sure, our investing timeline remains three to five years, but it's gratifying to have gotten off to such a strong start. Indeed, our strongest performer so far has handed index-tracking funds such as Fidelity Spartan(FUND:FSMKX) and Vanguard Total Stock Market(FUND:VTSMX) -- and of course popular exchange-traded funds such as Spiders(AMEX:SPY) and iShares S&P 500Index(AMEX:IVV) -- a drubbing, sprinting to an advantage of more than 25 percentage points since I first recommended it to Champion Funds subscribers.

Despite that strong run-up, I continue to think it's a compelling buy opportunity. And while I feel that way to varying degrees about each of our picks, some buying opportunities are sweeter than others. To that end, the very next issue of the newsletter also spotlights the pick that I currently regard as the Champ mostly likely to deliver outsized returns over the next three to five years.

Built to lastWhy am I so confident in our funds? Good question. Here's the good answer:

As every Fool knows, the money management biz is rife with mediocrity. In our newsletter, however, we zero in on just those funds that have Championship attributes, such as talented managers, battle-tested strategies, and strong track records of success. Our funds also feature well-diversified portfolios. Whether they invest in the likes of go-go companies, such as eBay(NASDAQ:EBAY) and Starbucks(NASDAQ:SBUX), or more value-oriented fare such as ExxonMobil(NYSE:XOM) and SBC Communications(NYSE:SBC), our fund picks are designed for investors who want to build wealth over the long haul while getting a good night's sleep along the way.

They also come equipped with a built-in competitive advantage that's sure to appeal to cheapskates (like me) everywhere: low costs. Indeed, while the typical stock fund -- you know, the one you wouldn't want to touch with a proverbial 20-foot pole -- will swipe roughly 1.5% of your assets each year for the "privilege" of investing in it, our Champs will ding you less than 1%, on average.

In addition to being run by smart folks with smart strategies, then, our funds begin each year with a nice head start: Every basis point of expense, after all, represents a hurdle that a fund's management team has to overcome relative to less-pricey peers -- not to mention expense-free benchmarks such as the S&P 500.

Not too shabby, eh?

Coming soonIn addition to the year-end review, there are a few significant changes coming down the Champion Funds pike, several tweaks, improvements, and fine-tunings that are designed to make the newsletter service even more useful for our subscribers. I'll have more to say about those in upcoming commentaries, but, speaking of our subscribers.

Along with the newsletter itself, the Champion Funds community is one of the vital elements of the service. I've been investing in and analyzing mutual funds for quite a while now, and I learn new things every day on our dedicated discussion boards. Your free Champion Funds trial will give you the opportunity to test-drive those -- along with the rest of the Fool's world-famous boards -- and see what you think.

For my part, I think you'll be mighty impressed. But you don't have to take my word for it: Click here to see for yourself. In the meantime, stand by for details on our upcoming changes. I, for one, couldn't be more excited about rolling them out!

Shannon Zimmerman, editor and analyst for Motley Fool Champion Funds, is a fund fan of long standing. You can receive a free trial subscription to his newsletter by clickinghere. Shannon owns shares of Vanguard Total Stock Market fund. The Motley Fool isinvestors writing for investors and has a disclosure policy.